Amazon to give in to Macmillan diktat; to be forced to push up e-book prices

January 31, 2010, By Sanjeev Ramachandran

It seems like a truce, at least for the time being, has been called on the e-reader warzone. Publisher Macmillan’s stance could lead to the online retailer raising prices on some of its e-books Amazon has connected with customers through a message on its website, which reads: “We will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books.”

It has been reported that Macmillan has directed Amazon to charge $12.99 to $14.99 for e-book versions of bestsellers and most hardcover releases. However, in the current scene, Amazon charges just $9.99 for the e-book version of most new releases and bestsellers.

Amazon has, though temporarily, removed all titles published by Macmillan from its website. By doing so, Amazon wants to make heard its disagreement and the seriousness of its disagreement on the pricing. Meanwhile, Amazon is also under pressure from publishers who are worried about dwindling royalties. To add to the trouble, the market now has devices such as the Apple iPad, which is looking at bringing titles soon on it itself. When prominent titles make their way to Apple iPad, Amazon might see some of its revenues go that way too.

(Via Reuters)

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